The construction and testing of a unique instrument, the Paleobiosphere, which mimics some of the conditions of the ancient earth, is described. The instrument provides an experimental testing system for determining if certain microbes, when provided an adequate environment, can degrade biological materials to produce fuel-like hydrocarbons in a relatively short time frame that become trapped by the shale. The conditions selected for testing included a particulate Montana shale (serving as the “Trap Shale”), plant materials (leaves and stems of three extant species whose origins are in the late Cretaceous), a water-circulating system, sterile air, and a specially designed Carbotrap through which all air was passed as exhaust and volatile were hydrocarbons trapped. The fungus for initial testing was Annulohypoxylon sp., isolated as an endophyte of Citrus aurantifolia. It produces, in solid and liquid media, a series of hydrocarbon-like molecules. Some of these including 1,8-cineole, 2-butanone, propanoic acid, 2-methyl-, methyl ester, benzene (1-methylethyl)-, phenylethyl alcohol, benzophenone and azulene, 1,2,3,5,6,7,8,8a-octahydro-1,4-dimethyl-7-(1-methylethenyl), [1S-(1α,7α,8aβ)]. These were the key signature compounds used in an initial Paleobiosphere test. After 3 weeks, incubation, the volatiles associated with the harvested “Trap Shale” included each of the signature substances as well as other fungal-associated products: some indanes, benzene derivatives, some cyclohexanes, 3-octanone, naphthalenes and others. The fungus thus produced a series of “Trap Shale” products that were representative of each of the major classes of hydrocarbons in diesel fuel (Mycodiesel). Initial tests with the Paleobiosphere offer some evidence for a possible origin of hydrocarbons trapped in bentonite shale. Thus, with modifications, numerous other tests can also be designed for utilization in the Paleobiosphere.